Nineteen years ago, on February 6, 2007, Pakistan signed away Gwadar Port’s commercial future for four decades.
The government would build the roads, the airport, the expressway, and the breakwater. A private concession-holder would run the port, fill the Free Zone, bring in the shipping lines and turn the deep-water harbor on the Arabian Sea into the trade gateway the Master Plan had promised.
The government has now put a number on how that bargain has played out: 4,789. That is the cumulative total of containers Gwadar has handled since operations began, measured against an installed annual capacity of 240,000 twenty-foot equivalent units (TEUs). Not per year – total, since 2007.
Alongside it sits a Free Zone that is 1.2% occupied out of 2,323 acres allotted, fewer than 300 jobs created against 38,140 promised under the Master Plan, and a concession-holder that has deployed roughly US$250 million of a committed $1.2 billion while collecting 91% of port revenue to the state’s 9%.
These figures come from a strategic research brief prepared for the Minister of Planning, Development and Special Initiatives and presented on June 16 by Noor Ul Haq Baloch, chairman of the Gwadar Port Authority (GPA).
It is, in effect, the government’s own, blunt scorecard on the deal it made. The state, it concludes, has met its side of the bargain. Islamabad has poured 61.2 billion rupees (US$219.7 million) into public outlay since 2007, built the Eastbay Expressway linking the port to the national highway network, and opened the new Gwadar International Airport in January 2025. What has not materialized is the commercial engine the concession was designed to build.
The port was handed over under a 40-year Build-Operate-Transfer agreement, originally signed with PSA Gwadar and novated to the China Overseas Port Holding Company Limited (COPHCL) in April 2013. The deal bundled three integrated businesses, the Multipurpose Terminal, the Container Terminal, and Marine Services, together with a separate 923-hectare Free Zone lease executed in 2015, all under exclusive commercial rights.
In exchange, GPA was to receive 9% of terminal revenue, 15% of Free Zone revenue and 9% of marine services revenue. What the agreement did not include, according to the brief, were clear performance milestones.
No Key Performance Indicators (KPIs) were written into the concession, no minimum throughput targets, no timeline for attracting shipping lines, no occupancy benchmarks for the Free Zone.
Two decades on, the absence of that scaffolding shows. GPA’s cumulative receipts across every revenue head combined come to just 313 million rupees against 61.2 billio rupees n in public money spent building the port’s surrounding infrastructure.
Three berths are operational, fitted with five ship-to-shore cranes. But the port has never secured a main-line liner relationship — the regular, scheduled vessel calls from major global shipping alliances that turn a terminal into a functioning trade node rather than a berth waiting for business.
Without those calls, even the most modern terminal would struggle to generate meaningful container traffic. The scale of the underperformance becomes even clearer when viewed against an international benchmark.
The brief reaches for an uncomfortable benchmark: Tanger Med, the Moroccan port that began, like Gwadar, on an empty coastline. Within 15 years, Tanger Med had reached 10.2 million TEUs annually and attracted more than 1,100 export-oriented firms into its free zone. Gwadar, at a comparable stage in its own development, has 1.2% Free Zone occupancy and no equivalent industrial base to show for it.
The brief’s central diagnosis is that Tanger Med succeeded because the port and its surrounding industrial zone were built and filled as a single program, not as sequential projects.
Gwadar, by contrast, built the quay and left the rest — the connecting road corridor to the mineral belt in Chagai, the border facility at Gabd, 87 kilometers from Iran’s already-built Rimdan zone, and reliable water and power for industrial tenants — either incomplete or entirely absent.
The brief counts five such connectivity gaps in total, from an unfinished hinterland corridor to a single 1.2 million gallons per day (MGD) desalination plant serving a city still on grid load-shedding. Fine infrastructure on the quay, the brief notes dryly, is not the same as a working connection to the cargo and markets that would fill it.
The stakes go beyond one underperforming terminal. The brief frames 2026 as a closing window: competing regional transshipment hubs, Duqm in Oman, Salalah, the Grand Faw project in Iraq are advancing now, while Gwadar’s structural advantage as a port 180 nautical miles from the Strait of Hormuz sits largely unused.
Pakistan is also facing a specific and newly urgent case for developing Gwadar as an energy hub. The brief describes the 2026 Hormuz crisis as having turned an “Oil City” concept — strategic fuel storage and an eventual out-of-Hormuz refinery from a long-range ambition into a near-term necessity, with an indicative first-phase cost of $1-2 billion.
Layered on top is Balochistan’s mineral wealth. The Reko Diq copper-gold deposit alone represents a projected $74 billion over 37 years under its Barrick joint venture, and the brief identifies a 650-kilometer mine-to-port corridor to Gwadar as the logical export route — one that also happens to be over a third shorter than hauling ore to Karachi instead. None of it moves without a functioning port at the other end.
To its credit, the document does not stop at diagnosis. It lays out five specific, time-bound actions: dredge the channel from its current 12.5-metre depth to the 16 meters main-line vessels actually require; activate the Gabd–Rimdan special economic zone, currently stalled awaiting an FBR regulatory order on transit trade; commit to a mine-to-port corridor route; secure the 100,000-acre Oil City site and commission a Phase-I feasibility study; and the item with the most direct bearing on everything else, reopen and reform the concession agreement itself, introducing the performance milestones it should have carried from the start.
That last point is arguably the crux. A 40-year exclusive concession without enforceable KPIs is, functionally, a concession with no mechanism for accountability. The brief’s recommendation to open additional operators where COPHCL cannot deliver main-line calls is a modest but pointed acknowledgment that exclusivity, absent performance, has not served Gwadar’s interests.
Gwadar still has geography on its side. It sits closer to the Strait of Hormuz than any other deep-water port in the region, at the southern end of a CPEC corridor built specifically to reach it, and within reach of Central Asian markets that pay a 40% premium in trade costs for lacking their own sea access.
What it has been short of, on the government’s own account, is a concession structure that converts that geography into cargo. Nineteen years and 61.2 billion rupees into the project, that is the reform Islamabad’s own numbers say can no longer wait.
Mujtaba Arshad is an economist and research associate at the Centre of Excellence for CPEC (a joint project of PIDE and the Ministry of Planning, Development & Special Initiatives), where he researches China-Pakistan economic engagement and regional connectivity. He holds an MPhil in economics, econometrics and quantitative economics from Quaid-i-Azam University, Islamabad.
